# In the matter of Excel Timbers Private Limited CP(IBC)-52-KOB-2022

> NCLT judgment dated 2023-02-10. Citation: TCN-2023-NCLT-04637. Dhanlaxmi Bank Limited, the Financial Creditor, filed an application under Section 7 of the…

- **Court:** NCLT
- **Order date:** 10 Feb 2023
- **Citation:** TCN-2023-NCLT-04637
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/excel-timbers-private-limited-cpibc-52-kob-2022-abbe7465

## Summary

### Background

Dhanlaxmi Bank Limited, the Financial Creditor, filed an application under Section 7 of the Insolvency and Bankruptcy Code, 2016, to initiate Corporate Insolvency Resolution Process (CIRP) against Excel Timbers Private Limited, the Corporate Debtor. The Financial Creditor had sanctioned a loan facility to the Corporate Debtor, which was acknowledged by the Corporate Debtor, its Directors, and its Subsidiary. A Facility Agreement was executed, and the Corporate Debtor agreed to repay the loan in equated monthly installments with floating interest. The Corporate Debtor defaulted on repayments, leading to the loan account being classified as NPA. SARFAESI proceedings were initiated but the FC proceeded under IBC to initiate CIRP.

## Facts

Dhanlaxmi Bank Limited sanctioned a loan facility of Rs. 1,50,00,000 to Excel Timbers Private Limited, acknowledged on 16.12.2011. A Facility Agreement was executed on 28.12.2011, with repayment in 120 equated monthly installments at 14.50% interest. A Demand Promissory Note for Rs. 1,50,00,000 was executed on 28.12.2011. The Corporate Debtor acknowledged the loan liability via letters dated 27.11.2014 and 20.10.2017. The loan account was classified as NPA on 05.12.2017 due to the Corporate Debtor's failure to settle debts. SARFAESI proceedings were initiated. The application under Section 7 of IBC was filed on 19.09.2022, seeking condonation for delay based on the Supreme Court's order in MA 21/2021 in MA 665/2021 (suo moto WPC No.3/2020), which excluded the period

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## Issues and analysis

### Issue 1: Whether the petition is …

**Ratio:** The Supreme Court's suo moto order in MA 21/2021 in MA 665/2021 (suo moto WPC No.3/2020)

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**Reasoning:** The NCLT considered the date of NPA (05.12.2017) and the exclusion period granted by the

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**Interpretation:** The Supreme Court's suo moto order provided relief to litigants by excluding a

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**Application:** In this case, the NCLT applied the Supreme Court's order by excluding the

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## Parties

- **Judges:** P. Moha…; Satya Ranjan…
- **Appellants:** Dhanlaxmi Bank…
- **Respondents:** Excel Timbers…

## Timeline

- **2011-12-16 — Loan San…**: Financial Creditor sanctioned the…
- **2011-12-28 — Facility Ag…**: Facility Agreement executed by the…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 7 — Initiation of corporate insolvency resolution…](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-7)

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